Bi-Lo Ratings Stable After Debt Increase

Sep 18, 2013

NEW YORK — The decision by Bi-Lo Holdings Finance LLC to increase a term loan on proposed senior notes will be credit negative, Moody's Investors Service here said, though it will not have any impact on the company's B2 corporate family rating or its stable ratings outlook, the ratings agency added.

Bi-Lo said it will upsize its senior unsecured PIK Toggle notes due in 2018 to $475 million from $400 million, with the proceeds from the term loan to be used to increase a proposed shareholder distribution to $450 million from $400 million, with the balance used for fees and expenses.

Moody's also said the increase will not affect the holding company's Caa1 rating on its proposed senior unsecured PIK Toggle notes or the B3 rating for Bi-Lo's existing $425-million senior secured notes.